J Kumar Infraprojects shares was locked in upper circuit of 5 per cent on the Bombay Stock Exchange and National Stock Exchange on Friday.

J Kumar Infraprojects shares was locked in upper circuit of 5 per cent on the Bombay Stock Exchange and National Stock Exchange on Friday. (Photo: Reuters)

J Kumar Infraprojects shares was locked in upper circuit of 5 per cent on the Bombay Stock Exchange and National Stock Exchange on Friday. Shares of the infrastructure company soared after it announced that Mumbai Metro Rail Corporation Ltd (MMRC) has issued LOA (letter of award) to J Kumar-CRTG’s joint venture for Rs 5,012 crore projects. On the BSE, shares of the company jumped 4.99 per cent to Rs 162.15, while on NSE it advanced by 5 per cent to Rs 163.90. Later, the scrip ended 4.99 per cent up at Rs 162.15 on BSE.

“MMRC had issued the LOA (letter of award) to J Kumar-CRTG JV for the 3rd phase of the Metro project and the project was assigned to JKumar-CRTG JV last month,” the company said in a release.

J Kumar said the project comprises design and construction of underground sections including four underground stations at Dharavi, BKC, Vidhyanagari and Santacruz and associated tunnels worth Rs 2,858 crore. It also includes design and construction of underground sections including CSIA domestic airport, Sahar Road and CSIA International airport and associated bored tunnels worth Rs 2,153 crore.

Brokerage firm Edelweiss is bullish on J Kumar Infraprojects shares with a target price of Rs 400. Edelweiss in a research report said, “The Mumbai Metro Rail Corporation (MMRC) has signed the contract agreement for Mumbai Metro Line 3 project with various contractors. The corporation has inked agreements with 4 civil contractors, including J Kumar Infra (JKIL), for 6 project packages. This will enable the contractors to claim mobilisation advances and start work post the monsoon season. We envisage significant fillip to J Kumar’s execution as the Line 3 project comprises around 50 per cent of the company’s order book. We believe the company is the best play on the burgeoning metro rail opportunity in India. The stock trades at an attractive P/E of 11.4x FY16.”